7/16/2009

It didn’t take long to run into an “uh-oh” moment when reading the House’s “health care for all Americans” bill. Right there on Page 16 is a provision making individual private medical insurance illegal.

When we first saw the paragraph Tuesday, just after the 1,018-page document was released, we thought we surely must be misreading it. So we sought help from the House Ways and Means Committee.

It turns out we were right: The provision would indeed outlaw individual private coverage…

House Majority Ldr. Steny Hoyer recently said that the health-care reform bill now pending in Congress would garner very few votes if lawmakers actually had to read the entire bill before voting on it. I guess he knew what he was saying.

This aspect of Obamacare is even more socialistic than the system in countries like France, where many doctors will not see patients who do not have private insurance in addition to the government-controlled coverage. Then again, the House also proposes to pay for Obamacare by making our tax system more socialistic than France’s, so maybe we should not be surprised.

When discussing his proposed government takeover of the US healthcare system, Pres. Obama always hastens to assure people that if you like your current coverage (as the overwhelming majority of people routinely tell pollsters they do), you will be able to keep it. However, if you lose your individual coverage, you will be unable to buy new insurance. And the mentality that outlaws new individual insurance may be inclined to do the same for employer-provided insurance in the future. Not that the Left will have to resort to that. If Obamacare passes, insurance will generally become a function of government. And any “public option” that passes will unfairly compete with private insurers — bypassing the laws that apply to private insurers, sticking taxpayers with hidden administrative costs, paying below-market Medicare rates (which in turn inflate private costs), and so on, until they have crowded competition out of the market.

We can be glad that the Democrats were so brazen about their intent as early as page 16 of their bill, as they have just made life easier for people fighting the nanny state. It is tempting to ask what might be in the remaining 1,002 pages of the bill. However, as the Leftist strategy here seems to be to strongarm moderates into not filibustering a final House-Senate bill, the real question is whether our elected representatives will read — or even give Americans a chance to read — the final product before a vote is taken. The moderates really have the power to dictate the final product. The issues are whether they have the guts to do so… or whether voters can scare them into doing the right thing.

–Karl

UPDATE BY PATTERICO: Name of the publication corrected to “Investor’s Business Daily.”

Update/clarification: Patterico flagged this post from Tom Maguire, noting that existing policies are grandfathered and that all new qualified privately offered plans must meet certain guidelines to which a grandfathered plan will not be subject. As to the first point, this is why I noted that the issue arises if you lose your individual insurance. If the House provisions passed, as the Foundry notes:

[A]ll individuals will be mandated to buy Insurance Exchange qualifying plans only. And thanks to a laundry list of new regulations, these plans will be much more expensive after the bill takes effect.

The private individual market will end, as we know it. Individuals will be dealing with an artifical market constructed by the government and paying more (which would also tend to push people into any “public option” available, which I’m sure is purely coincidental). There is some debate about the Insurance Exchanges in the comments already, but what interests me now is that — to the extent that the IBD story lacks that nuance, it is largely because IBD relied on the House Ways and Means Committee for its answer. Congress increasingly likes to vote on bills it has not read; apparently the staff cannot come up with a complete answer when the press asks about this bill, either. Not exactly confidence-inspiring. –K

Two main bills are being rushed through Congress with the goal of combining them into a finished product by August. Under either, a new government bureaucracy will select health plans that it considers in your best interest, and you will have to enroll in one of these “qualified plans.” If you now get your plan through work, your employer has a five-year “grace period” to switch you into a qualified plan. If you buy your own insurance, you’ll have less time.

And as soon as anything changes in your contract — such as a change in copays or deductibles, which many insurers change every year — you’ll have to move into a qualified plan instead (House bill, p. 16-17).

When you file your taxes, if you can’t prove to the IRS that you are in a qualified plan, you’ll be fined thousands of dollars — as much as the average cost of a health plan for your family size — and then automatically enrolled in a randomly selected plan (House bill, p. 167-168).

Again, if the House bill became law, it would be the end of the individual insurance market as we know it.

221 Responses to “Obamacare: The mask is off”

“…But when a long train of abuses and usurpations, pursuing invariably the same Object evinces a design to reduce them under absolute Despotism, it is their right, it is their duty, to throw off such Government, and to provide new Guards for their future security.”

This is exactly the sort of thing that doomed the Clinton bill. It is the mistake that Canada made; they banned any balance billing or private practice UNLESS the doctor resigned from the entire national plan which would prevent the patient from recovering any costs from the government plan. Even England allows private insurance and the last time I checked, 25% of the people in southeast England had private insurance. Since southeast England is the only economically productive part of the country, that tells you something.

Add to this outrage the other outrages:
– absurd tax hikes,
– small business jobkilling mandates,
– rube goldberg rules,
– robbing states to pay for this bill in medicaid
– robbing from old people in medicare,

THIS IS QUITE POSSIBLY THE WORST BILL IN A GENERATION, AN ACCOMPLISHMENT THAT IS MORE REMARKABLE GIVEN HOW MANY BAD BILLS PELOSI CONGRESS HAS PASSED.

Senator Coburn (R-OK) introduced an amendment that was agreed to by a majority of the committee, including Dodd and Kennedy, that would require that all CongressKritters transfer to any public plan that they wish to impose on us, The Great Unwashed; ie, they would have to endure the same plan that they wish to burden us with.
Unless the Coburn Amendment gets stripped-out, no plan of socialized health-care will ever pass off of the Hill to the White House.

The public plan option in the health care reform bill was designed, according to the Obama administration, to offer “competition” to private sector insurance options, to make them perform better. Investor’s Business Daily had a look at the Democrati…

I am amazed about how you all simply take what is fed to you with zero research or critical analysis. Did any of you care to read the bill until page 16? Well, I did. By the way, it is right here, in case you have difficulty finding it.

Page 16 is simply defining the meaning of “Grandfathered Health Insurance Coverage”, and it states that if new enrollment is provided then the insurance plan cannot be considered “grandfathered”.

You guys please do some basic fact checking before reverberating a rushed, false statement in your echo chamber of doom.

Little tidbit from a classified source…Health care will not go forward for the jug-eared fool running our country. By the way, a little bird has also told me that Hillary is busy planning her exit from the Obama admin very soon, to boost her own opposition stance in order to face him down in 2012.

oderfla – Did you care to read all the way to page 19, where it says:IN GENERAL.—Individual health insurance coverage that is not grandfathered health insurance coverage under subsection (a) may only be offered on or after the first day of Y1 as an Exchange-participating health benefits plan.

Which then actually confirms the Link’s statement:So we can all keep our coverage, just as promised — with, of course, exceptions: Those who currently have private individual coverage won’t be able to change it. Nor will those who leave a company to work for themselves be free to buy individual plans from private carriers.

It should be noted that it’s entirely possible that this ‘version’ of the bill isn’t what the administration actually desires.

Using the example of ‘crisis level management’, it is sometimes preferable to lead with an absolutely unconscionable first attempt, which makes merely unacceptable follow-up versions seem acceptable in comparison. The government acts humble, contrite and chastised, while actually gaining what they desired from the outset.

This health care takeover is actually the incrementalism of power aggregation, not a search for health care solutions. The administration simply cannot be allowed to ‘structure’ the system, because structure is to the advantage of the government and it’s private sector lobbyists and to the dis-advantage of the citizens in need of medical care. IOW, they can’t choose the players.

There is a definite attempt by the Obama administration to conflate regulation with coronation.

@Apogee, no. It means that starting on the first day of the new rule health care insurance companies must conform to the new regulations for new enrollees. That sounds good to me, since the new regulations will protect consumers.

@Eric Blair: I didn’t and probably won’t read the entire bill, since Representatives and Senators have entire teams to parse their words and represent their constituents’ interests. However, the IBD editorial claimed that by simply reading until page 16 we would find a provision making individual private medical insurance illegal, while it is patently false.

Yet it continues to lecture others as to what the pertinent facts actually mean – brilliant.

since Representatives and Senators have entire teams to parse their words and represent their constituents’ interests.

The so – called “entire teams” you fatuously mention didn’t even bother reading the farking stimulus bill, they just went along with whatever Rahm said and told their lackey bosses to vote “yes” on the entire ginormous boondoggle. They still can’t tell you exactly what’s in that bill of sh-t, yet you traffic in the canard of “entire teams.” Brilliant.

The odiferous one is intent on lying about what is readily discernible from the language. If this was all such a good idea, stinky florida person, why must you and yours continue to lie about it?

Did you even bother to read the passage that IBD is referencing? How does not not effectively eliminate private insurance, and at the very least, ties people þo the plan the have on the day the public plan starts, removing their ability to switch to anything other than the public plan. You really are obtuse, aren’t you?

Newtons.Bit, I have also just ‘scanned’ it but the note on grandfathered plans on 16, notes that they cannot enroll new entrants unless they comply with the ‘essential benefits package’ definied in section 122. I defer to someone in the business to tell me whether that benefits package is onerous or not, but I do wonder what business of the federal government it is whether my insurance meets this type of requirement. Not to mention, one of the requirements is “No cost sharing,” which doesn’t sound like it will keep costs down to me. Study after study notes that preventative care, in and of itself, does not actually reduce overall costs.

(1) NOCOST-SHARING FOR PREVENTIVESERV-
ICES.—There shall be no cost-sharing under the es-
24
sential benefits package for preventive items and
25
services (as specified under the benefit standards),
1
including well baby and well child care.

Under the Orwellian header of “Protecting The Choice To Keep Current Coverage,” the “Limitation On New Enrollment” section of the bill clearly states:

“Except as provided in this paragraph, the individual health insurance issuer offering such coverage does not enroll any individual in such coverage if the first effective date of coverage is on or after the first day” of the year the legislation becomes law.

So we can all keep our coverage, just as promised — with, of course, exceptions: Those who currently have private individual coverage won’t be able to change it. Nor will those who leave a company to work for themselves be free to buy individual plans from private carriers.

Interestingly enough, The Senate bill which I was searching for the offending language, does not say the same things as the House bill, no big surprise there.

It sounds like insurance can be retained but new insurance can only be obtained through the exchanges and with the provisions they require.

I can live with most of this if they will just not ban private practice and balance billing or private option. That is what Canada did and the Clintons did.

I flew to Tucson this morning and, in the shuttle on the way to the house from the airport, I spent a half hour talking to a guy (the driver) about the health reform bills. I explained my concerns and he agreed. People are fearful of having their choices taken away.

You’d think the people who are so adamant about pro-choice would allow it in other areas.

Well, it does not need to be that way. Private health insurance companies can find a way to bundle $3.5 million per Representative, $11 million per Senator, and $780 million for Obama, for their reelection campaigns. They just need to talk to their nearest lobbyist.

“…bastard spawn of a Kenyan bigamist and an underage Kansan hippie” – I just swallowed my gum. And how true!

The cat is out of the bag bigtime. I will go out on a limb and predict the Congress does not have the will to pass this pron of a bill. And pron it is. They are actually in fear for their jobs.

If Waxman-Markey has been tabled indefinitely and the push back from voters scares Congress enough to withstand a full-out assault from Rahm ‘strongman’ Emanuel and they table Obamacare, this so-called president is a 100% failure within his 1st year. God willing.

Individual health insurance coverage that is not grandfathered health insurance coverage under subsection (a) may only be offered on or after the first day of Y1 as an Exchange-participating health benefits plan.

Again, it is a long passage. The late Robert A. Heinlein summarized it quite well in “Stranger in a Strange Land,” thusly:

“IN THE VOLANT LAND OF LAPUTA, according to the journal of Lemuel Gulliver recounting his Travels into Several Remote Nations of the World, no person of importance ever listened or spoke without the help of a servant, known as a “climenole” in Laputian – or “flapper” in rough English translation, as such a Servant’s only duty was to flap the mouth and ears of his master with a dried bladder whenever, in the opinion of the servant, it was desirable for his master to speak or listen.

Without the consent of his flapper it was impossible to gain the attention of any Laputian of the master class.”

This isn’t knew, and Swift was poking fun of the principle of the underlings really running the show.

In any event, would the person who wrote that nonsense say the same thing if those awful Republicans were in power?

Alphabetists, I think.

But the real meaning of the statement above is: let your betters decide what is best for you.

Scary how easily we give away our freedoms, isn’t it? All it takes is a letter change.

No they won’t, because they aren’t ‘regulations’ at all, but merely the transfer of power to the government – the power to decide who can and who cannot offer health care solutions.

How can they decide this? By setting regulations for businesses to follow, while simultaneously retaining governmental immunity in any lapse of the same regulations. And prices? Government can set any uncompetitive price it wants for goods and services, because it’s not accountable to any budget – oh, and please please disagree with me about how our government can’t just borrow more money to make up for budgetary shortfalls.

Eric Blair is correct, as well as the link. Eliminating choice by forcing health care solution providers to enter into a lose-lose competition with a government that is entirely in charge of the process is making any system outside the government run system ‘illegal’.

“How does not not effectively eliminate private insurance, and at the very least, ties people þo the plan the have on the day the public plan starts, removing their ability to switch to anything other than the public plan.”

The problem with all this is that they intend a “big bang” in which everything changes at once. That is a guarantee for chaos. I would be in favor of fixing Medicare, which in spite of massive subsidies by private care, is going broke. Instead, what they plan is to put everyone in Medicare ! I did notice in the Senate bill that health plans established in collective bargaining are exempt.

I would bet there is one chance in ten that this passes in anything like current form.

A lot of progs are going to be pissed off when they figure out this is not a freebie and that they are actually going to be REQUIRED TO SPEND money. I think a lot had visions of a gubmint giveaway instead of buy it or be fined, even if it’s subsidized at some levels of income.

“The problem with all this is that they intend a “big bang” in which everything changes at once. ”

Actually the point of creating grandfathering of existing plans is to not NOT change everything at once.

“Individual health insurance coverage that is not grandfathered health insurance coverage under subsection (a) may only be offered on or after the first day of Y1 as an Exchange-participating health benefits plan.”

Unpossible! The investors business daily clearly said this bill would “outlaw individual private coverage”

And just for you if you click your heels together three times and say “everyone will have their own doctors, your healthcare choices will be your own, and the government will not eliminate private insurance” then you too can go to the land of Oz.

I wrote about making private healthcare illegal back in 2007 here. The money quote:

“If the government purports to deprive me of my right to contract with a doctor to provide me or my family with healthcare at a price I am freely willing to pay and the doctor is freely willing to accept, that is an act of tyranny warranting open rebellion.”

Comment by daleyrocks — 7/16/2009 @ 4:43 pmA lot of progs are going to be pissed off when they figure out this is not a freebie and that they are actually going to be REQUIRED TO SPEND money. I think a lot had visions of a gubmint giveaway instead of buy it or be fined, even if it’s subsidized at some levels of income.

Gosh, just flashed back to the YouTube of the two women celebrating Obama’s election, and they were crying and screaming how happy they were because since Obama had been elected they would no longer have to worry about paying for gas in their car or paying for groceries… something like that.

imdw agrees that the Obama plan forces any existing private insurers into the government run system on day one, but somehow doesn’t understand how that outlaws individual private coverage.

If you go to work one day and have to conform to the dress code of your competition, sell your product according to the prices of the competition, and follow all the rules dictated by your competition, you’ve been taken over whether you’re smart enough to realize it or not.

“imdw agrees that the Obama plan forces any existing private insurers into the government run system on day one, but somehow doesn’t understand how that outlaws individual private coverage.”

The system creates a health exchange which all new programs go through. On day one, which is the point of htis provision — existing programs are grandfathered in. Now, IBD could report on what these health exchanges look like. I don’t know. I googled and found a heritage foundation article touting them. But I do know this legislation includes the fact that individual plans will be offered through the exchange.

Actually the point of creating grandfathering of existing plans is to not NOT change everything at once.

“Individual health insurance coverage that is not grandfathered health insurance coverage under subsection (a) may only be offered on or after the first day of Y1 as an Exchange-participating health benefits plan.”

Unpossible! The investors business daily clearly said this bill would “outlaw individual private coverage”

Comment by imdw

In fact what will happen is that employers will be between an 8% tax and a much higher cost for employee insurance plans. They will dump the employees and those individuals will have nowhere to go but into the exchanges which will quickly consist of one choice, Obamacare.

They are already saying that they will get savings from cutting doctor reimbursement. Doctor reimbursement is now at levels that will not allow new doctors to pay off their student loans. You might look at a few medical blogs like this one which may require registration. For that reason I’ll paste a part of it.

Heating things up a bit
““Their pay is determined arbitrarily by Acts of Congress, not by what they’re worth to their patients or to the market, and indeed in this way PCPs have a lot in common with workers in the old Soviet collectives.

They are directed to “practice medicine” by guidelines and directives which are handed down from on high; guidelines which, being forcibly based on what is called “evidence-based medicine,” necessarily address the average response of some large group of patients to the treatment being considered and do not allow much if any latitude for an individual patient’s needs; and which are often promulgated less to assure the excellent care of patients and more to further the agenda of various and competing interest groups, professional, governmental and otherwise.

They are limited to between 7.5 and 12.5 minutes per patient encounter (depending on the third party that controls a given patient’s medical care), and the content of what must occur during those 7.5 minutes is strictly determined by sundry Pay for Performance checklists, so as to strictly limit any interchanges between doctor and patient that do not meet the approved agenda for such encounters.

Their every move must be carefully documented according to incomprehensible rules, on innumerable forms and documents, that confound patient care but that greatly further the convenience of healthcare accountants and other stone-witted bureaucrats who are employed specifically to second-guess every clinical decision and every action the PCP takes.

They are expected to operate flawlessly under a system of federal rules, regulations and guidelines that cover hundreds of thousands of pages in immeasurable volumes that are never available in any readily accessible form. If they do not operate flawlessly according to those rules, regulations and guidelines, they are guilty of the federal crime of healthcare fraud. Furthermore, the specific meanings of these rules, regulations and guidelines are not merely opaque and difficult to ascertain, but indeed they are fundamentally indeterminate – that is, no individual or group of individuals in existence can say what they mean. So, PCPs operate under a massive quantum cloud of rules as best they can, but their actual status (regarding healthcare fraud) is, like Schrodinger’s cat, fundamentally unknowable – until the “box is opened” (typically through criminal prosecution), whereupon the meaning of the rules is finally crystallized in a court of law, and doctors who had been practicing in good faith find that they have at least a 50- 50 chance (like the cat) of learning that they are actually professionally dead.

Worst of all, PCPs have been charged with the duty of covertly rationing their patients’ healthcare at the bedside, and they have been pressed to nullify the classic doctor-patient relationship, by the healthcare bureaucracy that determines their professional viability, by the United States Supreme Court, and by the bankrupt, new-age ethical precepts of their own profession.”

The healthcare system has (intentionally, DrRich argues) rendered primary care medicine such a soul-wrenching, personally and professionally demeaning endeavor that it has pushed most PCPs beyond mere anger, frustration, or resignation. Most American PCPs over the age of 50 with any measurable degree of self-respect are desperately looking for a way to retire early, and the ones under 50 are looking for some feasible way to change careers. Any medical student who spends more than 15 minutes with a typical PCP “gets it” right away – if not directly from the PCP’s mouth, then from their hollow, far-away looks of desperation – and as a consequence, even those who entered medical school badly wanting to become primary care physicians quickly begin exploring alternative career paths, ones that might keep them at least an arm’s length from the soul-eating bureaucratic overseers for at least a few years.”http://covertrationingblog.com/primary-

The best part is the comments but I don’t want to take up too much room. There are a lot of doctors who are sorry they took up medicine right now. It could go either way. Obama knows nothing about economics or incentives. He thinks taxing millionaires will raise more money. Maryland found out that wasn’t true. He may just preside over a crash in medical school applications.

It’s the children what Barack Obama’s dirty socialist health care will hurt most. When we were growing up there was always such optimism associated with medicine and amazing medical progress was a Truth what was revealed before our eyes constantly and astoundingly. Kids of these days won’t experience that. Obamacare is based on a diminution of the value of human life and of the value of human freedom is why. Barack Obama is sort of evil. Like Anderson Cooper or Gargamel.

Mike – one thing we know for sure, Joe Biden knows all about the Great Depression and the Market Crash. He’ll tell you about FDR addressing the nation the day after the crash, and how everyone saw it on TV that morning.

#66, As you lower reimbursement you need to see more patients per hour just to stay afloat. As it is today, you can’t operate a PCP without seeing 4-5 patients per hour.

A Medicaid practice gets #35 per visit!!! Even at 5 patients per hour and a 50 hour work week your are talking $425,000 in revenues per year. To see that volume you need 5 Full Time Staff and about 1,200 square feet — which probably runs nearly $300,000 per year. So if you are wonderful Physician working like a dog you make $125K per year serving “the poor.”

Now federal, state, local, sales and property taxes …….

As a person who operates four medical practices, I can tell you without any doubt this bill will only further worsen the very care they allege to want to improve.

Obama is a LUNATIC. These Congressmen are LUNATICS.

Really not much more to say other than I hope the individuals who voted for these insane aparatchiks are the first to get put in the health care gulag. I only wish them the absolute worst.

I am still trying to understand how a Health Care Insurance Exchange will provide equal or better health care with less resources.

So long as MDs need to have mountains of staff to process, closets full of supplies to service and Insurance Companies pounding them on price …..

They are just going to see more patients, spend less time on them, refer them to more specialists and prescribe to them even more diagnostic procedures ….. because you gotta keep the malpractice premiums lower.

IBD screwed up in reading the bill — let’s just concede that. As mentioned earlier, the provision was referring to “grandfathered” health insurance. I read that part myself and that’s exactly what it says. By stating that “grandfathered” coverage actually referred to all private coverage, IDB was being blatantly dishonest, or to be as kind as possible, incredibly dense and deluded by wishful thinking.

Just because someone is on the right side of an issue doesn’t mean they’re always accurate. IDB has hurt its credibility, and that of others they have misled. We need better allies than that.

Mr. Fikes I think the IBD is substantially correct. Private health coverage goes away and it gets replaced by “grandfathered” private health coverage. This is same as how wolves pick off and isolate a tasty bit of prey from the herd. You just watch… when it goes down it’ll be Discoverychannelesque I promise, and it’ll go down fast.

daleyrocks and happyfeet,
Yes, existing private coverage continues as is. New private coverage is given additional conditions it must meet for an “Exchange-participating health benefits plan”.

It’s possible that the conditions will be so onerous that employers will drop that grandfathered coverage, pushing people into Obamacare. Mike K. said as much @#66.

In fact what will happen is that employers will be between an 8% tax and a much higher cost for employee insurance plans. They will dump the employees and those individuals will have nowhere to go but into the exchanges which will quickly consist of one choice, Obamacare.

But making private health care uneconomical is not the same as making it illegal, which is what IBD said.

Any mistake can and will be used to discredit all opposition to Obamacare, so precision is of the utmost importance.

[…] is based on myths like the myth of 46 million uninsured, but the lies are getting exposed and the Mask is off with this Rube Goldberg bureaucratic monstrosity. These ObamaCare bills could one day literally […]

I’m confused, Bradley. As I read the IBD editorial, it says the law prohibits new insurance policies that commence after the health care law takes effect. The editorial specifically states:

It turns out we were right: The provision would indeed outlaw individual private coverage. Under the Orwellian header of “Protecting The Choice To Keep Current Coverage,” the “Limitation On New Enrollment” section of the bill clearly states:

“Except as provided in this paragraph, the individual health insurance issuer offering such coverage does not enroll any individual in such coverage if the first effective date of coverage is on or after the first day” of the year the legislation becomes law.

So we can all keep our coverage, just as promised — with, of course, exceptions: Those who currently have private individual coverage won’t be able to change it. Nor will those who leave a company to work for themselves be free to buy individual plans from private carriers.

In other words, some health care will be uneconomical and some will be illegal, just as IBD said.

DRJ,
The IDB editorial does indeed say that. But it’s wrong. I read the same section they did, on Page 16. And they omitted the part about “grandfathered” coverage.

Here is a copy and paste from the PDF:SEC. 102. PROTECTING THE CHOICE TO KEEP CURRENT COVERAGE.
(a) GRANDFATHERED HEALTH INSURANCE COVERAGE DEFINED.—Subject to the succeeding provisions of this section, for purposes of establishing acceptable coverage under this division, the term ‘‘grandfathered health insurance coverage’’ means individual health insurance coverage that is offered and in force and effect before the first day of Y1 if the following conditions are met:

(1) LIMITATION ON NEW ENROLLMENT.—
(A) IN GENERAL.—Except as provided in this paragraph, the individual health insurance issuer offering such coverage does not enroll any individual in such coverage if the first effective date of coverage is on or after the firstday of Y1.

Doubtful if even Klein believes his story completely. He uses the words “theory” and “hope” throughout his article when describing the Health Insurance Exchanges. He also has several chains of “and if this happens, then this should occur”.

My favorite is when he cites free market principles to justify the elimination of private insurance in favor of quasi-private or public entities under the control of a massive centralized government bureaucracy. The irony is priceless (well actually, I guess it can be priced upwards of a trillion dollars or so):

And what happens when you introduce productive competition, efficiencies of scale, more innovation and increased consumer power into a market as dysfunctional as the current situation for health insurance? In theory, you get lower prices and higher quality. And if the Health Insurance Exchange has lower prices and higher quality, more individuals will use it and more companies will buy into it. And if that happens, then the efficiencies of scale should increase… and so the Health Insurance Exchange should further outpace the other markets…AND CONQUER THE WORLD!!!!!!

Okay I added the last part, but the fantasy espoused by Klein is that centralized government does a better job at free enterprise than free enterprise.

In short, this is not a plan but a pipe-dream made of the same fabric as utopianism or socialism. There is no technical analysis remotely resembling an engineered or economic blueprint — just fairy dust.

Probably the most honest statement in the article (more honest than anything President Obama has said):

In a government-run health care system, rationing care is the only way to control costs. If the government plan turns out to be cheaper, it’s going to be because patients and doctors are restricted in what they can do. But in practice, government-run health systems are always more expensive than expected.

As for Klein, he’s just extraordinarily shallow with a gloss of education, a perfect policy wonk. He really thinks government mandates can promote competition!

As I said at 7:09pm, Klein’s analysis is already bunk. He states that if the Health Insurance Exchange has lower prices and higher quality, more individuals will use it and more companies will buy into it.

But he leaves out that, minus the ‘Grandfathered’ portion, all plans will be mandated to run under the HIE (appropriate acronym) – which not only defeats his comparison with the ‘free market’, but reveals the actual incentive for businesses and government to eliminate existing ‘grandfathered’ plans.

Mr. Fikes, thanks for your post #77 (“IBD screwed up in reading the bill — let’s just concede that”). I may not agree with your opinions, but at least I agree with you in that the truth must not be distorted so easily and before our eyes. You are the very first right winger I see clearly admitting a mistake made by someone on your side of the aisle.

I’m even more confused now so let me explain what I believe the bill provides (and I haven’t read the entire thing, which means I could be in Congress):

1. Insureds can keep their existing individual policies if they want. These are the grandfathered policies.

2. Insurers cannot sell and insureds cannot buy into grandfathered individual policies or policies that don’t meet the guidelines that begin after the law goes into effect.

Bradley, I think this is what you’ve said but I also think it’s what the IBD editorial says. When IBD says “The provision would indeed outlaw individual private coverage,” isn’t it referring to the second category and that’s why the next sentence of the IBD editorial addresses the “Limitation On New Enrollment” section of the bill.

Reading the PDF document, page 16 seems to allow for the legal existence of private insurance policies outside of the Health Insurance Exchange (provided that such an issuer is “grandfathered”).

However, on page 19 the insurance CONSUMER is obligated to purchase only HIE plans after d-day; the exception being one who has a grandfathered-coverage-plan prior to d-day and keeps it until death.

If that person decides to drop the coverage (or if the issuer goes out of business or drops coverage), then that person must purchase from the HIE.

Over time, this would have to shrink the number of available consumers, forcing truly private insurance to slowly go out of business or become part of the HIE collective.

I am no lawyer, but the way I see it is that “all roads lead to hell” (just might take longer than some).

—

Page 19

(1) IN GENERAL.—Individual health insurance coverage that is not grandfathered health insurance coverage under subsection (a) may only be offered on or after the first day of Y1 as an Exchange-participating health benefits plan.

2. Insurers cannot sell and insureds cannot buy new individual policies that begin after the law goes into effect.

That was the point that annoyed me the most. It makes me want to respond to the creator or creators of such legislation the same way that I felt Honduras should have replied to Obama: Shut your big trap! After all, what gives you the friggin’ right to butt your big nose into our business and tell us what to do?!

Meanwhile, as an illustration of “the road to hell is paved with good intentions” and “the law of unintended consequences”:

Wall St Journal, July 11:

For 15 years Massachusetts has also imposed mandates known as guaranteed issue and community rating — meaning that insurers must cover anyone who applies, regardless of health or pre-existing conditions, and also charge everyone the same premium (or close to it). Yet these mandates allow people to wait until they’re sick, or just before they’re about to incur major medical expenses, to buy insurance. This drives up costs for everyone else, which helps explain why small-group coverage in Massachusetts is so much more expensive than in most of the country. Mr. Romney argued — as Democrats are arguing now — that the individual mandate would make that problem disappear, since everyone is always supposed to be covered.

Well, the returns are rolling in, and a useful case study comes from the community-based health plan Harvard-Pilgrim. CEO Charlie Baker reports that his company has seen an “astonishing” uptick in people buying coverage for a few months at a time, running up high medical bills, and then dumping the policy after treatment is completed and paid for. Harvard-Pilgrim estimates that between April 2008 and March 2009, about 40% of its new enrollees stayed with it for fewer than five months and on average incurred about $2,400 per person in monthly medical expenses. That’s about 600% higher than Harvard-Pilgrim would have otherwise expected.

The individual mandate penalty for not having coverage is only about $900, so people seem to be gaming the Massachusetts system. “This is a problem,” Mr. Baker writes on his blog, in the understatement of the year. “It is raising the prices paid by individuals and small businesses who are doing the right thing by purchasing twelve months of health insurance, and it’s turning the whole notion of shared responsibility on its ear.”

DRJ and all,
The quote IBD used was used out of context, because the paragraph immediately before it made it clear that the quote only concerned the definition of “grandfathered” coverage. It was not a legal restriction on who could get health insurance. IBD screwed up by not reading its quote in relation to the preceding paragraph, which defined what the quote referred to.

Pons Asinorum, this “exchange participating health benefits plan” will impose restrictions in private individual health insurance. supposedly to protect the public. That’s how Mike K. reads it, and I’ll defer to his reading. The devil is in whether the details make it uneconomical to buy private health insurance.

I think the take-home message about Obamacare is not to rely on exposing hidden gotchas. I’m sure they exist, alongside muddy and confused language. But what’s really important is that the whole concept is faulty and will inevitably lead to a single-payer system.

No private business can directly compete with the federal government. The government makes the rules. The government doesn’t need to make a profit. The goverment can print more money, or subsidize coverage with tax revenues. That’s the point people need to understand, and the erroneous IBD editorial is a distraction.

Even in reading it in the manner in which Brother Bradley suggests, it is still going yo force people to purchase only from the HIE, and one party is going to be offering a product that they can sell at unlimited loss, while writing the rules for their “competition”. It may not be illegal, but there sure as hell ain’t gonna be any choices, despite what the sycophants like imdw and odiferous are babbling about.

Personally, I think that if we can’t all of us be sure what the bill really says or what it will do, then we just better pass it through the Senate and get the thing into law as quickly as possible, before people get even more confused!

I agree with JD @100 that the effect of Obamacare will be to eliminate private health insurance. Obama will weep crocodile tears as that option goes away, pretending he did his best to keep it available.

In the far left libtard world, either you agree with their entire nutbag agenda or you’re a heretic and must be cast out immediately, Bradley. That’s what makes the Trolls expounding on the GOP “internal strife” so amusing – projection is the sum total of their arguments.

The local building code now requires much safer electrical systems than I have in my 100-y.o. home (higher amperage, breakers instead of fuse box, grounded outlets, etc.). My home is grandfathered; I can even sell it as is. On the hysterical IBD/Patterico/Conservative Clown Show argument, no one can build new housing. Of course they can, and they do, it just has to meet the new code.

What a pile of mendacity, Andrew. You can buy something new, as long as you can compete with someone that has a significant competitive advantage, ans they can write at endless loss, and they write the new rules. I am so tired of dishonest hacks spewing garbage and proclaiming their fealty to Teh One.

Andrew can be relied upon to post a foolish comment from time to time. Unlike houses (The British have an expression “safe as houses”), health insurance can disappear if the employer decides he would rather pay 8% “penalty” than the premium for the health insurance policy that has been saddled with mandates like accepting all comers including those with pre-existing conditions.

Speaking of fools, the AMA and the American College of Surgeons have now endorsed the House plan for a promise not to cut physician payment. I think they are fools to take the word of people like Pelosi and Waxman. To get a flavor of what is coming, this is a quote from another medical blog.

As primary care physicians’ practices have changed in large part due to the tightening of the reimbursement screws one of the effects has been the increased use of ER by the primary care doctors’ patients ( in off hours and weekends) and/or those folks who cannot find a primary care doc to begin with. With this change one would think the increasing importance of the role of the ER docs should be evident to all including the policy wonks at CMS. Apparently they do not as their new pay schedule gives these figures for the ER physician and the chiropractor:EM docs are valued at $ 38.36 per hour versus chiropractors valued $65.33 a hour.

This is in keeping with other rationing schemes that value non-scientific treatment because it is “cheaper” and the fools who choose that over conventional treatment deserve what they get. Politics is about making people happy, not about helping them do better, either in health or economics.

Mr. Fikes, I apologize for labeling you right winger, then. Unfortunately, then, I still have to see a right winger admit a mistake… bummer!

By the way, listening to Hannity on my way to lunch, guess how he started his radio show today? Exactly. Taking this IBD’s misleading editorial with obviously no critical thinking and blaring it to his victims with his sharp forked tongue. Right wing noise machine in full throttle, what a sad spectacle!

Look, you can make an argument that the Obama plan will drive private insurers out of business. That would require some work, although in theory, it might even be true.

Or you can make an argument that the Obama plan simply outlaws private insurers. The IBD made the latter claim based on a patently mistaken misreading of the bill’s grandfather clause. It appears that their lack of reading comprehension is not a problem to swaths of conservatives because at least they are showing empathy with the private insurers.

“legally driving people out of business and making that business illegal reach the same result.”

Well, first, it isn’t at all clear that the law actually would drive people out of business. (Health insurance is an uncompetitive oligopoly to begin with.) But the premise is (like so much babble thrown at Obama) absurd. Was it illegal for the government to construct freeways even though it put travel-oriented businesses on the old roads out of business? (Not to mention private toll roads.) Is it legal for government fire brigades to put private fire brigades out of business? The IBD starts with a flat-out error in reading, and rather than retreat to the more problematic economic argument, you shriek that it doesn’t matter anyway, the sky is falling.

Now, in terms of “proper health care”, the USA seems to have, at best, average performance in the industrialized nations, which makes it very hard to understand the hysteria here. I wonder if Obamacare will provide anti-anxiety meds for people who think private insurers are going to jail? People die all the time under our existing system; I guess if they aren’t blog commenters, they don’t count.

As I linked before, conservatives who read the alleged proof instead of gearing up the echo chamber of the right have figured out what a grandfather clause is.

Nah. They would never drive anyone out of business. Never. Except many have said this sets the dtage for single payer. Letting the govt write the rules, while they are “competing” with the benefit of being able to operate at a loss, resulting in a significant competitive advantage, seems like a great way to keep people in business. Even Joe Klein readily admitted that previously.

If this was such a great and popular idea, you sycophants would not have to lie about it.

“Look, you can make an argument that the Obama plan will drive private insurers out of business. That would require some work, although in theory, it might even be true.

Or you can make an argument that the Obama plan simply outlaws private insurers. The IBD made the latter claim”

Crazy Andy – You’re back! Purely a quibble over semantics with the same end result but of course you’re focused on the choice of words rather than the substance as always. Are you seriously having trouble understanding why a government plan which reimburses health providers at lower rates than private carriers, which does not have to comply with the same safety and soundness regulations or oversight as private carriers, does not have to pay taxes or maintain capital reserves and all the other good stuff private insurers do represents an uneven playing field of insurmountable proportions in terms of pricing differential? I know you are not as dumb as you seem, so surely you can grasp this concept.

Health insurers an oligopoly? Because it’s a regulated undustry? With more than 1,300 nationwide surely you jest, although they move in and out of states based on market conditions. Take a guess what the most important determinants are of market conditions.

The IBD made a specific claim about how the Obama plan would drive private insurers out of business; namely, by making them illegal. That is total nonsense, and after all the shrieking is over—the election really unhinged you guys, I guess—no one denies this.

If you think that (a) private insurers would go out of business [and (b), that’s a bad thing], you can assemble a detailed explanation of why that is so. You can’t short-circuit the process by making up a claim from thin air.

If I say the death penalty doesn’t deter crime, then I perhaps I can assemble a statistical argument in favor of my claim. I can’t misread some part of the statute to say the death penalty won’t work because the prisoner will be reincarnated as a predatory ghoul.

“The IBD made a specific claim about how the Obama plan would drive private insurers out of business; namely, by making them illegal.”

Andrew – You didn’t read closely enough. It did not say the insurers would be illegal, it said it would make individual private coverage illegal. If you can’t even correctly parse an article, why should people take you or your silly analogies seriously here?

IBD’s faulty reading of that quote is not only wrong, it’s counterproductive to stopping Obamacare. Here’s why:

Even if the Obamacare bill had a rock-solid assurance of private individual health insurance, the government’s intervention as a competitor with bottomless pockets would still drive the insurers out of business. So such an assurance would provide no real benefit. Worse, people could be deceived into supporting the bill.

By focusing on what will supposedly happen de jure, IBD is drawing attention away from the de facto result that is the real issue.

“By focusing on what will supposedly happen de jure, IBD is drawing attention away from the de facto result that is the real issue.”

Bradley – I don’t think the purpose of the IBD article was to focus on the entire problem, only the individual private insurance portion of the issue. I think you are blowing your interpretation of their questionable wording out of proportion, but that’s just my interpretation. Reasonable people can understand the intent without getting hypercritical.

“Speaking of fools, the AMA and the American College of Surgeons have now endorsed the House plan for a promise not to cut physician payment. I think they are fools to take the word of people like Pelosi and Waxman. To get a flavor of what is coming, this is a quote from another medical blog.”

The THUG-ocracy continues. What is going on know is nothing more than browbeating the various groups to ‘get in line or get flailed’.
The AMA are fools and retards to fall for it. They and the doctors will get sharfted twice as hard for being lemmings.

The IBD made a specific claim about how the Obama plan would drive private insurers out of business; namely, by making them illegal.

No, it makes new policies illegal unless they go through the “exchanges.” The second part is that the 1300 private insurance companies will have to compete with the subsidized “public option” and they will not be able to compete on price. Therefore, the employers who face higher prices will opt to pay the 8% penalty and be done with it.

I know that takes some comprehension and you do not have enough but that is the answer.

“If you think that (a) private insurers would go out of business [and (b), that’s a bad thing], you can assemble a detailed explanation of why that is so. You can’t short-circuit the process by making up a claim from thin air.”

There is a Titanic destruction of choice entailed in the bill. the fact is that ObamaCare destroys the free market in health insurance. You are quibbling that its through slow suffocation instead of a quick decapitation.The end result of the convoluted bill is the same.
See:

“The Democrats’ intention, obviously, is to drive private insurance into extinction so that we wind up with a “single payer” system, i.e., socialized medicine. In fact, in the health care proposal that Barack Obama put up on his web site during the campaign, he made it explicit that no private carrier would be allowed to compete with the government by offering a cheaper health insurance policy. That goal is achieved in a slightly different way by the proposals the Democrats are now debating.

So, while it isn’t quite correct to say that the House bill “bans private insurance,” it certainly is correct that the bill is intended to destroy competition and your opportunity to pay for your health care through a private carrier.”

“Even if the Obamacare bill had a rock-solid assurance of private individual health insurance, the government’s intervention as a competitor with bottomless pockets would still drive the insurers out of business. So such an assurance would provide no real benefit. Worse, people could be deceived into supporting the bill.”

Right. Destruction of private health insurance options is an inherent risk and problem with the Pubic Option. Still, the fact that all private health insurance options are being herded into this slaughterhouse of choice called Exchanges, is a telling point. “The Mask Is Off” was well-phrased; they are not masking at all this push to single-payer.

SPQR – Hinderaker makes the same mistake others have in interpreting the IBD article – he believes it relates to all private insurance. It refers to a subset – individual private medical insurance. What Hinderaker is describing is group insurance. He does add an interesting twist of interpretation though in that existing group medical plans grandfathered under Obamacare cannot add new members. By default then, over time, employers will be forced to transition to plans qualified under Obamacare rules.

Cool. Given that he could not name any violations of law present in the EIT, his investigation of Gitmo at the beginning of the year found it to be a model prison camp, and his own administration has adopted the same interrogation techniques, I think this should be fun.

I’d say the shrieking hysterics represented by your claims have fallen flat on their face, so you’ve got that going for you, which is nice.

In the sense that new buildings are illegal unless they go through the “building code”.

Except that these new buildings are right next door to new government owned buildings with equivalent space that charge tenants half the rent. As a tenant, which building would you choose Andy? That’s the analogy, not your dumbass building code example.

The “hair” is that the passage quoted by IBD doesn’t stand alone. It is grammatically dependent on the preceding paragraph, which states it is defining what “grandfathered” coverage means.

Here goes:

SEC. 102. PROTECTING THE CHOICE TO KEEP CURRENT COVERAGE.
(a) GRANDFATHERED HEALTH INSURANCE COVERAGE DEFINED.—Subject to the succeeding provisions of this section, for purposes of establishing acceptable coverage under this division, the term ‘‘grandfathered health insurance coverage’’ means individual health insurance coverage that is offered and in force and effect before the first day of Y1 if the following conditions are met:

(1) LIMITATION ON NEW ENROLLMENT.—
(A) IN GENERAL.—Except as provided in this paragraph, the individual health insurance issuer offering such coverage does not enroll any individual in such coverage if the first effective date of coverage is on or after the first day of Y1.

The bold part is what IBD quoted. Read it along with the preceding paragraph and the meaning changes.

If you think that is hair-splitting, let me remind you that in legal documents, hair-splitting can make a big difference. Lawyers argue over things as small as a comma. This selective quote is much, much, more significant.

For the record, IANAL, but my editor, who is, independently came to the same conclusion after I alerted him to it. After reading the actual bill text, I felt a bit silly about jumping the gun.

In further hair-splitting, I fault IBD for not including a link to the legislation in its online editorial. But that might be unfair — I can’t expect an old-fashioned media company like IBD to be jiggy with the Web like the folks here.

DRJ,
Excellent point! I’ll do that. Thank you for the reminder that I shouldn’t just complain, I should ask for an answer.

Also, I hope you don’t mind my using the comments again for asking for help with a new blog I’m working with, AP Watch.

I invite nominations for AP stories for us to look into. I and Tom Blumer at Bizzyblog are focusing on AP stories with major, indisputable errors, especially those that negate the story’s whole premise. This is not an ideological blog; accuracy is its only concern.

My goal is to get enough heat directed on AP that it makes a formal response. I’m asking editors to raise the issue, and we’d really appreciate help from the blogosphere. AP is the main source for newspapers, so its errors are disproportionately damaging.

Again, this is a totally nonideological project. I am appalled at the low level to which journalism has sunk — and if journalism has no credibility, there’s not much of a future for me in it. So that’s my motivation. Blumer is a conservative, but also mortified at seeing outrageous errors, and darned smart with numbers. And I’d also like a left-of-center partner for a balanced troika.

I appeal to all bloggers of goodwill, no matter what their political beliefs, to spread the word about this new project and its call for accuracy.

Bradley – Thank you for pushing the discussion on this. One of my biggest complaints why the subjects of insurance is discussed, in the media or on blogs, is imprecision. It is a complicated enough subject without people throwing around terms meaning different things and talking past each other. I still maintain IBD is talking about individually purchased policies from the text of the article, but that wording of the bill will have the effect of gradually Obamifying existing group health plans since they are prohibited from accepting new members or making changes after the effective date without losing their grandfathered status.

Luckily, as more people read this bill so I don’t have to, the fascistic nature of Obama’s overall plan will become clear and his blatant lies to the American public will be exposed. His reform has been a farce since day one.

Meanwhile, how is that Massachusetts Medical Miracle performing you ask?

“A state commission recommended yesterday that Massachusetts dramatically change how doctors and hospitals are paid, essentially putting providers on a budget as a way to control exploding healthcare costs and improve the quality of care.

The 10-member commission, which includes key legislators and members of Governor Deval Patrick’s administration, voted unanimously to largely scrap the current system, in which insurers typically pay doctors and hospitals a negotiated fee for each individual procedure or visit. That arrangement is widely seen as leading to unneeded tests and procedures.

Instead, the group wants private insurers and the state and federal Medicaid program to pay providers a set payment for each patient that covers all that person’s care for an entire year and to make the radical shift within five years. Providers would have to work within a predetermined budget, forcing them to better coordinate patients’ care, which could improve quality and reduce costs.

Massachusetts would be the first state to adopt such a broad “global payment’’ system, and commission members are acutely aware that Congress and the Obama administration are watching how the state moves forward as the federal government overhauls healthcare nationally………….

Consumer advocates said patients are going to have to be educated about the new system. Patients could find it harder to get procedures they want but are of questionable benefit if doctors are operating within a budget. And they might find it more difficult to get care wherever they want, if primary doctors push to keep patients within their accountable care organization.”

“Even if the Obamacare bill had a rock-solid assurance of private individual health insurance, the government’s intervention as a competitor with bottomless pockets would still drive the insurers out of business.”

I keep being told that government care under the public option will suck and lead to long lines and whatever parade of horribles. You really think that private industry can’t compete against that? That people won’t want to pay to avoid that?

“You really think that private industry can’t compete against that? That people won’t want to pay to avoid that?”

imdw – One question I have is whether state insurance regulators will allow them to charge rates high enough to break even under the rules of Obamacare so it may become a question of availability, not necessarily demand on the part of consumers. Why don’t you folks seem to understand that part of the equation? Losing a little on each enrollee and making it up on volume is not the path to long-term success in the insurance business.

Imdw is back either playing stoopid, or actually being that stoopid. Even Joe Klein admitted that the government would have a significant competitive advantage, having the ability to price at nearly unlimited loss, and conveniently, getting to write the rules against its “competitors”. The honest Leftists admit this is the first step to single-payer. Imdw is not honest.

AC – One of my big contentions about the health care debate is that it has always been about cost shifting. Priced correctly, over the long-term insurance should be breakeven between the customer and the carrier. Lefties want free care.

“Give me a break–you don’t give a crap about providing competition, you just want someone to pay your bills for you.”

In the past I’ve had insurance with co-insurance and with a copay. I must say I preferred the latter.

“imdw – One question I have is whether state insurance regulators will allow them to charge rates high enough to break even under the rules of Obamacare so it may become a question of availability, not necessarily demand on the part of consumers”

I’m not aware of state regulators setting prices, but the proposal before congress is for federal, not state reform.

“imdw – How much more would you pay for better service – as an individual, as a business owner for your employees?”

That’s kind of a useless question because it depends how much better. I don’t particularly care for my MD now, but have no reason to trade up. But I do like my dentist and pay more and go out of network for him. So like me, I think people will be willing to pay more for better, and so long as we find ways for this to happen we’ll have competition. Specially if the public option is horrible. Now, if the public option is super awesome, then we’ll end up with the terrible result where people are getting super awesome care.

“AC – One of my big contentions about the health care debate is that it has always been about cost shifting. Priced correctly, over the long-term insurance should be breakeven between the customer and the carrier. Lefties want free care.”

Break even? Where do insurance companies make a profit then? Where do they get rewarded for taking on risk?

“That’s kind of a useless question because it depends how much better.”

imdw – It’s as good a question as asking whether you can’t compete against the parade of horribles you referred to above.

Insurers, their plans and prices are regulated by states currently. Some forms of insurance require prior approval for use, some don’t. You can’t dodge the question as part of the answer to whether private insurers can compete with a government option. The can have competing plans out there but because they need to show a profit or breakeven, priced so high nobody will buy them. The government plan won’t face the same constraints. It’s not rocket science, even for you.

“imdw – It’s as good a question as asking whether you can’t compete against the parade of horribles you referred to above. ”

If you asked me ‘how much more would you pay for a better computer’ the answer would definitely depend on how much better. Some things are a good deal and some aren’t. I’ve been offered crappy old free computers before. But I still went out and bought a nice little Lenovo.

Now, if the public option delivers something crappy, people will want to pay more for better. So how do people compete with the public option? By charging more and delivering better.

imdw – Insurers don’t have a monopoly on stupidity. If they are making too much profit on underwriting in one sector – premiums less cost of originating business (underwriting and commissions, etc.) and claims cost, competition enters. If they’re losing their asses, companies leave or try to raise prices. Regulators try to prevent that – like with Prop. 103 in California, propert insurers leaving Florida due to Hurrican exposure, med malpractice insurers leaving litigious states. Over the long-term they get left with investment income. Look at Berkshire Hathaway and the war chest Buffet has to invest from his insurance companies. That’s where he has made his real money.

“So how do people compete with the public option? By charging more and delivering better.”

imdw – I suggest you read the article I linked to in #146 concerning the Massachusetts Medical Miracle to get a sense for what happens when the government mandates insurance coverage rather than continuing to dance around the obvious.

But if they’re making money on a given investment, they’ll also face competition there. Just like in their market. I think you’re on to something though — I think investment losses would correlate well with insurance rates, more so than litigation. Do you really model the insurance business as perfectly competitive to the point of there not being any profits or rent seeking?

“Daley – Note how quickly they puke out their mendacity, then so bravely flee.”

It’s just such a fascinating formulation. That the reward that insurers have for carrying risk is that they have a pool of money to take other risks with.
There’s no making money from people for carrying their risk. That’s a ‘break-even.’ What other ways can consumers get someone to take on risks in a break even fashion?

“There’s no making money from people for carrying their risk. That’s a ‘break-even.’ What other ways can consumers get someone to take on risks in a break even fashion?”

imdw – Remember the words “long-term.” Abnormal profits or losses shift the competitve balance in any given line of insurance or state, with regulators providing frictional barriers to entry or exit.

Banking can be expressed largely in the same terms. Banks earn a spread over the reinvestment of their deposits into loans or other intruments. Profit is what they earn over and above the cost of their deposits. Basic, but think about it.

imdw – Here are some recent P&C industry statistics from A.M. Best to support what I’ve been saying. The statistics are the combined ratio, the sum of the expense ratio and loss ratio for the P&C industry by year since 2001.

The way to read the above numbers is to say in 2001, the industry paid out $1.16 for costs to originate business and pay claims for every dollar of premiums ir earned. The stats are across all lines, so obviously profitability will vary and will also vary by state.

First, health insurance, in the sense that life or casualty insurance is written, does not exist. What we call health “insurance” is actually prepaid care. There may be an exception for high deductible policies like $2500 deductible but the others are prepaid care. The insurance companies administers claims and the claims are paid from premiums, not from investment income like the other “real” forms of insurance.

Anyone who doesn’t understand that cannot be trusted to discuss health care reform.

A better example of what is in store for us IF Obama’s plan passes is the student loan business. In the fall of 2007, Congress decided that banks were making too much money from student loans and changed the law. Chaos resulted, as you know if you were trying to get a student loan in 2008.

The sequences of events in health insurance will follow the game plan in student loans where private sources, which had been in existence since 1960, were gradually superseded in the past four years since Congress went back to the Democrats.

Please notice that government student loans had absolutely no effect on tuition inflation.

“If the insurers are allowed to “charge more and deliver better”, then why are they mandated to run their operations through the HIE?”

I posted an article above on the exchanges.

it has this in it:

The Health Insurance Exchange gives you another option. Unlike your employer, it will have a wide array of competing providers offering different plans with varying benefit levels, emphases and price tags. Unlike the individual market, insurers won’t be able to discriminate based on your health history or your future risk. Plans will have to be certified as meeting a minimum level of comprehensiveness. Plans that routinely screw over members will lose customers to competing insurers.

The Health Insurance Exchange, combines the benefits of choice that are theoretically available on the individual market with the bargaining power and scale that’s generally accessible only in large employers (and the exchange will, in theory, have more bargaining power than even the largest employers, as it will have a much larger base of customers). You also have a space to test out innovative ideas that might make the market better, like Sen. Jay Rockefeller’s (D-W.Va.) insurance rating agency, or the public insurance option. You can standardize billing and payment methods and force the adoption of electronic medical records.

And what happens when you introduce productive competition, efficiencies of scale, more innovation and increased consumer power into a market as dysfunctional as the current situation for health insurance?….

“If the idea is to deliver better health care, then why all the regulatory structure? Why not just ensure that the care delivered isn’t injurious?”

“Isn’t injurious” is a pretty low standard. And for that we have the tort system. You like that regulatory structure?

Steverino – Even excluding the income replacement coverage for the worker, I would say it isn’t. I don’t see how it differs from covering accidents under a health policy, so I don’t follow Mike K’s point. A&H policies can be actuarially priced based on a given participant population rather than priced on actual claims plus an admin fee. Large companies don’t like to just trade dollars with an insurance companies and would generally rather pay claims as incurred, rather than prepaying.

Steverino – Even excluding the income replacement coverage for the worker, I would say it isn’t. I don’t see how it differs from covering accidents under a health policy, so I don’t follow Mike K’s point.

The difference in a general health policy is that your employer isn’t the one who caused the accident, and the accident didn’t take place on the employer’s premises.

You have a personal injury rider on your homeowner’s policy that would cover a visitor who slipped and fell on your front steps. But if he slipped and fell anywhere else, your homeowner’s policy wouldn’t cover him.

Another Chris reminds me of am article that appeared back when David Duke was in a serious race for office. One of his supporters was explaining that she supported Duke because he stood up for the white people who were being cheated by all of the black people on welfare. But, the interviewer asked, aren’t you on welfare? Yes, she replied, but everybody knows that the black people get bigger payments.

Comes now AC, with his assertion that we leftists are just cowards who want other people to pay for their care. Now, AC doesn’t mind my paying for his fire protection, or his police protection, and he probably lives in a state that sucks tax dollars away from mine, but when he may have to pay for my health care, that’s where he draws the line. (I’m curious to know what AC’s health care situation is, but it’s rude to ask.)

You couldn’t ask for clearer evidence that the fear about Obamacare is not that it will fail, but that it will succeed, and America will follow the wimpy European tradition of not letting the poor die in the streets if they fall sick, or at least go bankrupt. Pity that.

Daley, almost all health insurance now is ASO work. The insurance company administers the employers health plan and presents a monthly bill to cover claims paid. There is some difference with individual policies, like the one I have on Annie but her insurance has doubled in two years, probably because she is getting into child bearing years even though she has no plans to have a child. Still the claims and premiums equal each other every year on average.

Workers comp is pretty much claims administration. There is almost no investment income because the claims, while better than five years ago, are still out of control. A very large share is illegal aliens and there is an enormous amount of fraud. One of the pernicious effects of this is that the fraud stimulates silly levels of micromanagement. That frustrates the good docs who see a few workers comp cases so they quit and then there is nothing but the mills and the crooks.

Medicaid has been that way for years and Medicare is starting to go that way as reimbursement is cut. What is so foolish is that primary care keeps people away from hospitals. Kaiser, which is not a charity, pays out about 50% of its expenses for professional services to primary care. Most private insurance pays out about 30% and Medicaid probably pays out 20%.

If they asked me, I could tell them how to fix health care and there are 10,000 guys like me who have been in practice, who have some additional education in health care management and who are no longer in practice so we have no axe to grind. Obama has plenty of Democrat fund raisers who are experts, I’m sure.

imdw – You seem to have difficulty understanding with the concept of free markets and competition.

You state:Unlike the individual market, insurers won’t be able to discriminate based on your health history or your future risk. Plans will have to be certified as meeting a minimum level of comprehensiveness. Plans that routinely screw over members will lose customers to competing insurers.

And who are these competing insurers? One of them is the government, which isn’t directly accountable to customers like the others, as well as not dependent to turn a profit. Which makes the mandate of forcing the retention of unprofitable customers much more important than you let on.

Oh, and the government gets to write the ‘standardized’ billing and payment methods, along with setting the ‘minimum level of comprehensiveness’.

There is no poison pill or mandate in the legislation that I can find that forces the government to cease participation if they don’t turn a profit, so you already have one ‘competitor’ that has no possibility of failure, while the others will be judged harshly by any and all transgressions, including unprofitable behavior.

Just which one of the ‘competitors’ in that scenario would benefit from your ‘economies of scale’?

“The difference in a general health policy is that your employer isn’t the one who caused the accident, and the accident didn’t take place on the employer’s premises.”

Steverino – Let’s say the employee is injured at work and the employer also provides a health insurance plan. Which coverage is the claim going to be filed under, the comp policy or the or the health policy? I’d say the comp policy, but you never know.

If the worker incurs the same injury off the job not due to any third party negligence or anything, he’ll file a claim under the employer’s health policy. Are the situations fundamentally different? By law the employer has to buy workers’ comp coverage.

The vast majority of work comp claims I see, the worker has no other insurance. Granted, I see the problematic claims. If the care fits all guidelines, I never see it.

For those who think insurance companies are trying to derail Obama to keep that great cash cow, health insurance, this explanation from a guy who knows might enlighten you. Insurance companies are desperate to get OUT of the health insurance business.

It’s a LOSER for them. Sorry to burst your bubble, Andrew and the other lefties.

Dr. Bruce Chernof, director of the county Department of Health Services, which oversees the facility, has called Rodriguez’s death “inexcusable” and said it was “important to understand that this was fundamentally a failure of caring.” He has said conditions are improving, though.

Those healthcare bastards!

Wait, you mean that this occurred in a county run facility? IOW a government health care facility?

Of course none of the government employees cared that this woman was dying in the middle of the ER.

They were on break! How dare she.

Expect more death – much more – if Obama’s plan is enacted. And it will be the fault of the Obama administration and their supporters.

Funny that you’re not concerned about this sort of thing, Andrew, when it’s already occurred. You want government health care? Read up on King-Drew Medical Center, who, after years of killing people had to close because they just couldn’t get their shit together.

Nike K – I think we’re going to have to disagree on a few of our views of insurance. We’re coming at it from different perspectives – mine from the carrier side. Workers’ comp is a longer tail line of coverage and generates tremendous investment income from its reserves. Insureds would love to avoid trading dollars with carriers in the working layers of those policies as you described above, but usually only credit worthy insureds are able to do that to any great extent. Only a small number of insurers specialize in that type of high deductible workers’ comp program (million dollar deductible and up) and claims are typically handled by TPAs. Insurers such as Reliance, CNA and Kemper have done themselves some real damage by cutting corners with business in that area or put themselves out of business entirely.

The ability to generate investment income from insurance depends on the payout pattern of claims. Shorter tail coverages generate less investment income. If the insureds hang on to the cash and are billed monthly in the example you described above, that is really more of a fee for service type of arrangement rather than a traditional risk taking function.

and America will follow the wimpy European tradition of not letting the poor die in the streets if they fall sick, or at least go bankrupt.

Oh, stop with the phony bleeding-heart routine.

As for Obamacare, it will merely formalize and legitimize what’s going on in clueless but do-gooder (and idiotic, and debt-ridden) California. IOW, even more tax dollars will be forced into the healthcare system, ultimately helping the so-called disenfranchised far, far more than it helps the saps in the middle and above.

Meanwhile, the experiment of healthcare reform (or “reform”) is running into potholes in Ted Kennedy’s home state (ie, Massachusetts), probably because the citizens in that part of America aren’t generous, wonderful, loving and selfless enough.

LA Times, July 10, 2009:

As California lawmakers struggle with a budget gap that has now grown to $26.3 billion, one of the hottest topics for many taxpayers is the cost to the state of illegal immigrants.

State welfare officials estimate that cutting off payments to illegal immigrants for their U.S.-born children could save about $640 million annually if it survives legal challenges.

[I]illegal residents pay taxes — sales taxes on what they buy, gasoline taxes when they fuel their cars, property taxes if they own homes. The total is hotly debated, although most researchers agree that the short-term costs to state and local government are bigger than the revenues.

* Healthcare: The expected state tab for healthcare in fiscal 2009-10 is $703 million for as many as 780,000 illegal immigrants. Of that, $486 million goes to emergency services. But low-income illegal residents are also eligible for some nonemergency health services, including prenatal and postpartum care, abortions, breast and cervical cancer treatment and certain types of long-term care, such as stays in nursing homes. Most of the nonemergency care for illegal immigrants was authorized by the Legislature in the 1980s.

Much of those costs are beyond the control of state officials. The U.S. Supreme Court ruled in 1982 that the Constitution forbids school districts to turn away children who are illegal immigrants. And federal law requires emergency rooms to treat everyone, regardless of citizenship.

The Center for Continuing Study of the California Economy, based in Palo Alto, has analyzed research on the costs of illegal immigration. Most studies show that at least in the short term, illegal immigrants, who tend to be poorer and have more children than average, use more in public services than they contribute in taxes, the center found.

[Delia] Godinez, a 43-year-old undocumented Mexican immigrant, left an abusive family and lives in transitional housing. Four of her five children are citizens and receive a total of about $650 each month from the state’s CalWorks program. She also receives about $500 in federal food stamps and other vouchers.

Businessweek.com, July 16, 2009:

When Massachusetts enacted the most comprehensive insurance-for-all bill in the U.S. in 2006, it did nothing to address rapidly rising costs. Three years later the rate of uninsured residents has dropped from 8% to 2.6%, the lowest of all 50 states. But the cost of covering an additional 428,000 residents is wreaking havoc on the state’s finances.

Long one of the most expensive states for medical care, Massachusetts’ costs have risen even higher since passing universal coverage. The state will spend $595 million more on health insurance this year than it did three years ago, a 42% increase. Its latest budget proposal calls for eliminating insurance subsidies for 30,000 legal immigrants in an effort to save money.

State officials need look no further than neighboring Maine to see what will happen if they don’t act. Maine enacted universal coverage in 2005, also with no cost constraints. Premiums for the state-financed insurance plan have risen 74% since, and many residents have dropped coverage. Maine’s uninsured rate is back at 10%, barely lower than the pre-reform level.

Speaking of which, I’m aware that Mike K has often cited the system in France as one alternative to the status quo in America. Since he is a doctor and has observed the healthcare industry from the frontline — and also has a down-to-earth attitude — I’d have far more confidence in someone like him managing reform legislation instead of the bunch of mostly fools and dopes that we, the electorate, chose to place in Congress (and in the White House). However, I imagine he would admit that every system has its defects, which is why the overly cocky attitude of leftwingers like Obama towards the issue of socialized healthcare is so pathetic and laughable.

As a rightist, I’m willing to say the healthcare situation in America certainly has its faults and requires some adjustment. But that brings to mind the phrase of “capitalism may not be perfect, but it’s better than the rest.”

Businessweek.com, June 2007:

Gazing across the Atlantic won’t lead Americans to a model that fits everyone’s requirements. Britain, in particular, suffers myriad problems in its National Health Service (NHS). But in some respects, France comes pretty close to the ideal. Not only are its 62 million citizens healthier than the U.S. population, but per capita spending on health care is also roughly half as much.

France relies on a mixture of public and private funding, as does the U.S. But unlike Americans, every French citizen has access to basic health-care coverage through national insurance funds, to which both employers and employees contribute. Some 90% of the population also buys supplementary private insurance to provide benefits that aren’t covered, and the government picks up the tab for those out of work who cannot gain coverage through a family member.

“We pay higher taxes in France, but at least we get something for our money,” says Leslie Charbonnel, an American who has lived in Paris for two decades.

The key to France’s success is that its system, like the U.S.’s, values patient choice and physician control over medical decision-making. But France does it for far less, with per capita health-care spending in 2004 at just $3,500, compared with $6,100 in the U.S., according to the World Health Organization. All told, France spends 10.7% of gross domestic product on health care, vs. 16.5% in the U.S.

One reason the French system seems able to do it all is its practice of using price controls. A national fee schedule determines reimbursement paid by the government and by most private insurers. Doctors can charge extra, and more than one-third do. But the low rates set by the national fee schedule — typically less than $50 for a routine office visit — help keep salaries modest. French doctors on average earn just one-third the salary of their U.S. counterparts, says Paul Dutton, an associate professor of European history at Northern Arizona University and author of Differential Diagnoses, a comparison of the French and U.S. health systems.

Despite this, rising costs and an aging population make it a struggle for France to finance its system. On May 29, the government warned that health-care inflation this year is running ahead of projections, threatening to deepen an already worrisome $5.2 billion deficit.

In Britain, the National Health Service presents a much grimmer picture. It has provided universal coverage for nearly 60 years and boasts benefits such as drug prescriptions that cost no more than $13 for a month’s supply.

Yet despite the government pouring $81 billion into the NHS over the last six years, access to treatment is spotty, and long waiting lists are the norm. In 2005, 41% of British patients waited four months or longer for elective surgery, compared with less than 10% in the U.S., according to London-based think tank Civitas.

Limited resources also mean medical care varies widely depending on where you live. Access to life-extending new cancer drugs is especially constrained. As a result, Britain has one of the lowest five-year survival rates for cancer overall: 43% for men and 53% for women, vs. 53% and 71%, respectively, in France.

A further downside for residents of Britain: The cash-strapped NHS places less emphasis than the U.S. or France on preventive care. Annual physicals aren’t insured. And screening programs are less generous than in the U.S. So despite the fact that pap smears can help detect cervical cancer, the second leading cause of death for women, they are only offered once every three years, as opposed to the recommended annual test in the U.S.

What neither the French nor the British system can overcome is the stark math of cost-benefit analysis. A cancer drug like Avastin, which can extend a patient’s life by a few months, costs $48,000 annually per patient. It’s far too expensive, by NICE’s reckoning, to provide to all colon cancer patients, so it’s available to none.

In France, the state pays a portion and the wealthy are free to make up the difference. Money, in other words, buys good health—on both sides of the Atlantic.

cato-at-liberty.org:

President Obama already plans to increase the top federal rate from 35 percent to 40 percent at the end of 2010. That would push the combined federal-state rate to 47 percent, substantially above the average of other major industrial nations. Imposing a 4-percent surtax on top would push the top rate to 51 percent, which would be higher than many nations that were traditionally more socialist than America, including France (46%), Germany (48%), and Italy (45%).

Andrew – looked at the horror stories on Obama’s website (thanks for the unbiased link)

Here’s one:I am a single mom and my health coverage is so limited. I hope that we will have the option to have medicare.

Several,if not the majority of Obama’s horror stories involve HMO’s, organizations that are essentially bureaucracies charged with allocating funds, not maximizing health care. Bureaucratization is the problem, and Obama just wants more of it.

No mention of the actual costs involved, just an emotional appeal.

Funny that there aren’t any emotional success stories like mine, where a family member’s life was extended twice by implanting new heart valves from a calf and a pig.

The problem, Andrew, isn’t that health care in the US is perfect now, but that it would be far worse under Obama’s plan, for the various reasons already stated, specifically one of them being absolutely no fiscal or performance accountability for the government plan. You feel comfortable handing all control to bureaucrats, despite all the evidence that they screw up almost everything they touch.

“I must say that for corporations Mike K assures us are desperate to get out of the health insurance business, they seem to be trying hard to hold on to it.”

Andrew – Are you suggesting that all those horror stories on the website represent valid claims against insurance companies under the terms of the policies? Have you investigated? Do you want the insurance companies to exit the business the hard way, by paying all claims presented whether valid or not, or voluntarily so they have a chance of paying legitimate claims of policyholders? You decide.

Andrew and imdw, the stories I saw on a quick look at your site showed stage IV cancer patients who want the treatments that have not been proven to have a high yield of response. I sympathize with those patients but do you really think the Obama effectiveness research committee is going to approve them ? Take a look at breast cancer 5 year survival in the NHS compared to the US. WE have the highest 5 year cure rate in the world.

Daley, my experience is totally with California. Five years ago almost all carriers except the state sponsored SCIF had left the state. SCIF, which has a charter stating that it should have no more than 20% of the business in the state, had a 56% share at the time that reforms were finally passed. Maybe things have improved that much since then but I have my doubts.

I do review claims in others states but not that many. As of 10 years ago when I began to do this part-time, WC was wide open. I saw cases in which claimants had had 900 chiropractic treatments in one year. A lot of chiropractors built very large homes and are now concerned about the reforms. Maybe that’s a good sign.

It’s interesting that the lefties on Washington Monthly occasionally rant about denying claims for “brown people.” I guess that means they expect no rationing when government takes over.

“What makes even more money than ‘breaking even’ is getting money from people and then NOT paying claims.”

imdw – Insurance is a great business if you don’t have to pay claims. People with claims problems can go to their state insurance departments and raise hell. That’s what they are there for. Who are they going to complain to when the government denies a claim under Obamacare?

Mike K – California Comp was a mess, but states seem to go in rotation. Texas blew up in the early ’90s, etc, etc. My company would not touch California comp business on a plain vanilla basis due to the regulatory climate. Same for the Northeast. One year AIG wrote $5 million of premium in Maine but got assessed $40 million from their comp fund. Absolutely nuts.

IMDW had his frontal lobotomy for free in Canada. Shows up in all his comments.

I do love Canada though. What other country gives its animals better, faster, and cheaper treatment than people. Course when you let government run the healthcare system its no surprise.

I always love the lemmings bray about those evil corporations. The ones that provide the best healthcare in the world. The ones that produce 90% of the world’s new drugs and instruments. Yup, think how many new drugs were produced in France or the UK? Even the Italian PM came to the US for heart surgery. Must because of that great healthcare in Italy?

Think about it if you could choose care at Gitmo, Canada, or a government run Indian reservation hospital which would you choose? Somehow I don’t think anyone will pick the last two. I wonder why?

Yes, Mike K, I’ll agree that neither government nor private insurers will do well pouring money at expensive, ineffective treatments for Stage IV cancer. On the other hand, you seem to have missed all the stories like this one:

Dear President Obama, I am thirty one years old and am in several thousand dollars debt because I was unable to get insurance for several years because of a “pre existing condition”. In m early twenties I was diagnosed with malignant melanoma. I was fortunate enough to have caught it early and had a minor surgery to have it removed. I did not have insurance at the time because my full time job did not offer it. I tried to get private insurance but because I have had a history of skin cancer, the only type of insurance I could buy was high risk/emergency medical coverage. This cost between $300.00 and $500.00 a month. Obviously, this was not something I could afford when making $12.00 an hour. Each I became ill and could not afford to go to the doctor, I had to go to the Emergency Room. I knew that the ER has to see patients’ whether or not they could pay at the time of service. I also could never afford to pay the hospital bills once they arrived so the debt started to pile up.

Now, Another Chris is furious that he might have to help pay for medical care for this woman (any bets that A.C. had mommy and daddy’s coverage in his early twenties?), but to me this extremely plausible story suggests a major breakdown in the American health insurance system.

The United States has fine health care at the high end, but why the behavior of the plutocrat Italian PM should influence national policy escapes me. For all I know, the very wealthiest Haitians have good care, too, but (unlike some other commenters), the Haitian social structure is not one I recommend we adopt.

Andrew – What exactly do you believe the individual in your comment #205 is seeking? They say they cannot afford the cost of their own individual health insurance policy – even if they found one outside of a group plan in the current environment, whoever wrote it seems like they would be buying a loss based on the individual’s description of her own history. Aren’t they just seeking to shift costs to somebody else, not that there’s anything wrong with that?

Aren’t they just seeking to shift costs to somebody else, not that there’s anything wrong with that?

Somewhat. However, if we had a system where someone in her early 20s at a low-wage job could get comprehensive health insurance even if not provided as an employment fringe benefit, then she wouldn’t be in this mess in the first place. That is, there are two problems: her inability to get insurance now, as a (cowardly, per AC) cancer survivior, and her inability to afford insurance even before her initial diagnosis.

Argument by anecdote! Yippee!

Doubtless you are referring to Mike K’s retelling of workers comp horror stories. I mean, you can’t be suggesting that one side’s anecdotes are data and the other are ephemera, could you?

We have a health-care problem by anecdote, but we also have a health-care problem by aggregate statistics on health care expenses vs. outcomes (the Italian PM notwithstanding). The only criterion on which our system excels is the “let-them-eat-cake” philosophy beloved by so many commenters here.

We know the system is so bad due to the enormous numbers of people fleeing to Spain for routine matters …(Oopps, sorry, that was Castro importing a Doctor FROM Spain for a relatively minor matter that his own vaunted medical-care system had botched…are you listening Michael Moore?).

I think we have a chance at health care reform if people like those in the examples Andrew keeps throwing out realize that health care costs money. Health insurers are in business to make money. Creating a government option through Obamacare to absorb losses merely shifts costs while increasing the government deficit and does not solve underlying problems.

JD – The woman Andrew provided the anecdote for in #205 illustrates the progressive mindset very well. She describes health plans costing $300-$500 per month, which is probably not off the mark. She describes frequent trips to the hospital (admittedly rather than to the doctor) and cancer. Let’s say she and some of those other horror stories Andrew pointed out at Obama’s site rack up medical bills of $20,000 a year. What insurance company could pass up the chance to take in that kind of monthly premium in return for paying out those losses? What is wrong with those greedy farking insurers anyway? It’s like they were trying to make money or at least trying to avoid losing their shirts or something, damn it! They should lose money on each insured and make it up on volume, like a government plan.

daleyrocks, I think you’re onto something there. We’ve got a young woman who couldn’t afford insurance when she first entered the work force, and now no private insurer will touch her. You can’t blame them; they’re in business to make a profit and she’s a big risk. Meanwhile, the woman can’t get proper medical care. And we have hospitals that are creditors of her debts, which will be largely uncollectable, meaning they will have to seek financial support from other entities (including government).

I see this as a problem, and AFAICT daleyrocks sees it as optimal. I doubt he would see it that way if the woman in the anecdote were his neighbor, but who knows.

Andrew – Could you point out where said it was optimal? It sounds like we both agree that the behavior of the private insurers in not wanting to buy a certain loss in writing her coverage is rational behavior on their part. Why do you keep bringing stupid analogies and hypotheticals into your comments purely for snark?

All Obama is trying to do is force private insurers to cover the woman – how? – by mandating that everyone purchase health insurance whether they want it or not. It’s a tax on those that dodn’t have it and didn’t want it. By presumably including healthy people who were going without insurance in the pool of risks insurers are covering they are willing to cover lower quality risks such as the woman in comment #205 and lower overall prices. Unfortunately that has not been the experience in Massachusetts where the cost of their mandatory coverage has grown at rates exceeding national averages. Alternatively, Obama wants a government option available to provide coverage at lower prices than the private insurers. How can it provide lower costs? Price controls, rationing and eating losses that the private sector cannot afford to eat and survive.

Andrew, this is not rocket science and it’s not reform. It’s forcing somebody to take pipe. It’s either the healthy consumers who have foregone health insurance who now must buy it to subsidize the insurance of higher risk insureds, private insurers who are forced to compete under new rules, and the American taxpayers who are being asked to pay for a bailout of the sector under the guise of a government option.

Andrew, the problem of the poor, and that is what #205 is about, is separate from the health reform problem. There are community clinics and county hospitals that will treat her without having to go to the ER all the time. Unfortunately, the last big bang effort at health care by the government, Medicaid in 1965, wrecked the county hospital system that was providing good care for the poor at the time. I know because I was there. For a long time, Medicaid would not pay the county hospitals for care of the poor because the Medicaid program was intended to put the poor into private care.

The result was to starve the county hospitals of funds as their case load increased because of illegal aliens. We will have to recreate the system we had in 1965 to care for the poor or we will never get anywhere. You cannot put the poor into the private system because they do not follow the health belief models of the middle class. They do not take their medicine regularly and as instructed. They do not live healthy lifestyles. They don’t keep appointments.

I’ve been treating the poor for over 40 years. The community clinics are a good model and should be funded by any new program. Insurance will not solve their problems no matter how much subsidy is added. It’s a bit like the homeless. You can build affordable housing until the country is awash in it and you will still have people living in the street because 60% of them are psychotic. Only about 10% of the homeless are situational cases and they are homeless briefly and can use shelters for the period they need to adjust.

There are a lot of left wing shibboleths that get in the way of common sense.

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